Yahoo seeking patent windfall from Facebook

SAN FRANCISCO — Yahoo is threatening to sue Facebook unless the Internet social network agrees to license some of its patents covering a variety of online services.

The demand, issued in a late Monday statement, presents Facebook Inc. with a nettlesome headache as it tries to complete an initial public offering of stock.

The upcoming IPO helps explains why Yahoo decided to assert its patent rights now. Facebook may be more likely to work out a licensing agreement rather the risk having the specter of a legal battle dampen investor enthusiasm for its highly anticipated IPO.

Yahoo made more than $1 billion from a patent settlement that it reached with Google Inc. just before that Internet company went public in 2004.